Sugar mills in India can easily export up to 2 million metric tons of the sweetener this season as domestic supply prospects improve and local prices fall, according to the head of a major industry body on 18th December’24.

The supply situation appears to be better than initially expected, which is why the government should allow mills to export at least a million or two million tons of sugar," Deepak Ballani, director general of the Indian Sugar Mills Association, mentioned in an interview.

India’s Sugar Export Policy

Last year, India, the world's second-largest sugar producer after Brazil, prohibited exports of the sweetener for the 2022-23 season, halting shipments for the first time in seven years as a drought reduced cane yields and output.

The government of Prime Minister Narendra Modi prolonged the prohibition on sugar exports for the second consecutive season as India, the world's largest consumer of the sweetener, struggled with the possibility of reduced cane output.

Reason’s for Rise in India’s Sugar Production

The sugar season in India runs from October to September. However, India is expected to produce a record amount of sugar in the 2024-25 season as millions of farmers expanded cane cultivation, aided by plentiful water supplies and falling prices of competing crops. Ballani stated that “Since cane planting has been strong, the next year's production is expected to be quite robust.

Reasons Stated To Permit Sugar Exports

According to him, “In anticipation of substantially increased production, sugar prices have dropped, and the permission to export at least 1-2 million tons will help mills struggling with lower prices.

Due to plentiful supplies, sugar prices in India have dropped to their lowest point in one and a half years, making it challenging for mills to pay farmers the cane price.

According to Ballani, sugar prices have fallen well below the 41,000 rupees ($482.90) per ton cost of production for mills.

Even if the government allows us to export 2 million tons of sugar, we will still have a surplus of 5.6 million tons by the start of the next season on October 1, 2025,” Ballani predicted.